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CARO 2020 · built for auditors· CARO

Re-typing the same 21 CARO clauses for the fortieth company this March.

Most CARO paragraphs are mechanical — they restate what your investment schedule, statutory-dues ledger and ratios already say. CORAA auto-drafts up to 17 of the 21 clauses from those upstream signals (the exact count depends on entity type — an OPC, Section 8 or small company has more clauses resolved to a reasoned N/A), each one paragraph-anchored to the Companies Act and the ICAI CARO 2022 Guidance Note, each conclusion citing the source row it came from. The judgment clauses it leaves for you. The auditor decides; the engine does the drafting.

The honest split

21 clauses, two columns — and we never blur the line.

Auto-drafted from signals (up to 17)

Clauses that restate verifiable facts — investments and loans (iii), s.185/186 compliance (iv), statutory dues and their ageing (vii), repayment defaults to lenders (ix), related-party transactions (xiii), the financial ratios (xix) — are drafted straight from the data already in the engagement. No re-typing, no copy-paste from last year's file.

Reserved for auditor judgment

PPE and inventory physical verification, deposits under s.73-76, fraud reporting under s.143(12), whistle-blower complaints — these turn on procedures only you performed and conclusions only you can sign. CORAA leaves them blank for your input rather than guessing a conclusion it cannot support.

Spurious N/As, concluded — not skipped

When a company is an OPC, a Section 8 company, a small company, or a banking / insurance / LLP entity, the inapplicable clauses are resolved to a reasoned, concluded 'Not applicable' — citing why — instead of a silent blank a reviewer has to chase.

Clause (xix) wired to your SA 570 work

Clause (xix) bundles the financial ratios with the going-concern / material-uncertainty assessment as one paragraph. CORAA computes the ratios and wires the material-uncertainty conclusion to your SA 570 work, so what the CARO paragraph reports and what your audit file concluded are the same statement — not two answers a peer reviewer can pull apart.

What it drafts

Every mechanical clause, sourced — before you open the report.

01

Clauses (iii) & (iv) · investments, loans & s.185/186

Loans and advances, guarantees and security read from the engagement schedules under clause (iii) — terms and overdues drafted with the underlying line cited — and the separate s.185 / s.186 compliance that clause (iv) turns on drafted alongside it, so the conclusion is traceable, not asserted.

02

Clause (vii) · statutory dues

Undisputed dues — GST, PF, ESI, TDS, income-tax — tested against payment dates with an arrears-over-six-months view and a disputed-dues table. Drafted from the ledger, ageing shown, materiality-gated under SA 320.

03

Clause (ix) · default in repayment

Borrowings reconciled against repayment schedules to surface defaults to banks, FIs and debenture-holders, plus diversion and round-tripping signals — each flag traced to the source row rather than a blanket 'no default noted'.

04

Clause (xix) · financial ratios & going concern

The Schedule III ratios and ageing computed from the figures already in the file, with the working shown line by line, so the CARO disclosure and the notes carry one consistent set of numbers. Ratios and the material-uncertainty / going-concern assessment are one clause (xix) — drafted together, with the going-concern conclusion carried from your SA 570 work.

05

Clauses (xiii) & (xviii) · RPTs and resignations

Related-party transactions tested for s.177 / s.188 compliance from the RPT schedule, and auditor-resignation matters drafted from the engagement record — concluded where the data supports it, flagged where it does not.

06

The judgment clauses — left to you

Clauses turning on physical verification, observed controls or your own s.143(12) assessment are presented blank with the governing question, never auto-concluded. A draft you cannot defend is worse than a blank — CORAA does not hand you one.

Why it holds up

A CARO draft a peer reviewer can re-perform line by line.

Re-performable SA 230 trail

Every drafted clause carries a timestamped, rule-cited record traced to the source row and exportable straight to the working-paper file. A reviewer re-walks the conclusion instead of taking it on trust.

Deterministic, not generative

The same file and the same rules produce the same draft every run — no probabilistic wording that drifts between engagements. Where the engine reads your files it extracts and maps the data mechanically; the conclusions and their wording are rule-derived and templated, never generated — so nothing probabilistic touches the paragraph that reaches your report. Reproducible by design, which is what a peer review actually tests.

Materiality-gated under SA 320

What surfaces in a clause is filtered through the materiality you set, so the statutory-dues and ratio paragraphs flag what matters and stay quiet on what doesn't — you review what's material, not hundreds of trivial exceptions. Qualified, not assumed.

Every conclusion cites its source

No paragraph reaches a CARO conclusion without naming the row, schedule or SA conclusion behind it. When a partner asks 'on what basis', the basis is already attached.

Who it's for

Three desks, one CARO file — and the same source under each clause.

The article

Stops re-typing 21 clauses per company off last year's report. The mechanical paragraphs arrive drafted and sourced; the time goes into the judgment clauses that actually need a person.

The manager

Reviews a CARO draft where every concluded clause cites its row and every blank flags exactly what the auditor still owes — no more reconciling the report against the file by hand.

The partner

Signs knowing clause 19 matches the SA 570 conclusion, the N/As are reasoned not silent, and the whole order is re-performable if a peer reviewer asks. The opinion is theirs; the drafting is done.

What it changes
clauses auto-drafted
Up to 17 of 21
From upstream signals — investments, statutory dues, defaults, ratios — leaving the judgment clauses to you. The exact count varies by entity type, as more clauses resolve to a reasoned N/A for an OPC, Section 8 or small company.
clauses paragraph-anchored
21 of 21
Every clause mapped to the Companies Act and the ICAI CARO 2022 Guidance Note, concluded N/As included.
statutory dues recomputed
Full ledger
Statutory dues recomputed across the whole ledger, not a sample, then materiality-gated under SA 320 — so you see what's material, not hundreds of trivial flags.
cites its source
Every clause
Each conclusion traced to its row, schedule or SA reference — re-performable straight from the working-paper file.
Questions auditors ask

CARO 2020 automation, answered straight.

No. CORAA drafts the mechanical clauses and presents them with their sources; the auditor reviews, edits and confirms every clause before it forms part of the report. The engine does the work, the auditor reaches the conclusion. Nothing is reported until you confirm it.
Up to 17 — the clauses that restate verifiable facts already in the engagement: investments and loans (iii), s.185/186 compliance (iv), statutory dues and ageing (vii), repayment defaults (ix), related-party transactions (xiii), the financial ratios under clause (xix), and the reasoned 'Not applicable' conclusions for OPCs, Section 8, small, banking, insurance and LLP entities. The exact count varies by entity type — an OPC, Section 8 or small company has more clauses resolving to a reasoned N/A. The clauses turning on procedures only you performed — PPE and inventory verification, deposits under s.73-76, fraud under s.143(12) — are left blank for your input.
Clause 19 is wired to your SA 570 conclusion on material uncertainty, so the CARO paragraph and your audit file state the same thing. It does not form an independent going-concern view — it carries forward the one you concluded.
It works off what you already have. CORAA reads from your ledger export (Tally, Excel or your audit software) and the engagement schedules you already maintain — you don't re-key anything into a bespoke format. For clauses like statutory dues it builds the ageing from the ledger itself rather than asking you to pre-build that schedule. Real ledgers carry garbled or missing GSTINs and PANs, amended challans and clients with several registrations: CORAA flags the unparseable lines for review rather than silently dropping them, so a data problem shows up as a flag in the file, not a gap in the report. Where the underlying data genuinely isn't in the file, that clause stays a flagged blank — never a guessed conclusion.
Data is hosted in India, handled in line with the DPDPA and ISO 27001 controls, and is never used to train shared or third-party models. For a first run you don't need a live client file — bring anonymised or sample data, and trial data is deleted after the run. Your client data stays your client data.
The auditor does, entirely. CORAA is an assistive drafting and analysis tool — it does not form, sign or share responsibility for the opinion. Every clause is auditor-confirmed before it is reported, and the SA 230 trail records that confirmation. The professional judgment and the report remain yours.
See it on your own file

Bring one company's data — anonymised is fine. See up to 17 clauses arrive drafted for your review.

Load an engagement (anonymised or a sample file works) and see the mechanical CARO clauses arrive drafted and sourced, the spurious N/As concluded, clause (xix) tied to your SA 570 work — and the judgment clauses waiting, honestly, for you. The auditor decides; the engine does the drafting.